Madhavpura irked over BoI recovery plan

April 27, 2006 12:09 IST

Madhavpura Mercantile Co-operative Bank is peeved over Bank of India's proposal to recover Ketan Parekh's dues from the cooperative bank.

An official release issued by Badrinath Sharma, deputy general manager MMCBL, has stated that BoI had availed of a recovery certificate from the Debt Recovery Tribunal through applications, numbered 368/01, 369/01 and 370/01, for recovering dues from Parekh and his several companies.

Through this recovery certificate, BoI has also sought attachment of MMCBL's amount, recovered till date and to be recovered from Parekh and his companies.

MMCB has stated it had filed a criminal suit against Parekh, responding to which he had assured the Supreme Court that he would deposit the dues in instalments every quarter with MMCB.

So, according to the cooperative bank, the amount thus far recovered by Madhavpura Bank from Parekh are towards payments of loans and advances made to him by the bank. Since Parekh had not deposited any money with MMCB, the recovery targeted by BoI should be done from properties owned by Parekh and not from Madhavpura Bank, the release stated.

As per a Central government revival scheme, also approved by the Reserve Bank of India, the amount recovered from Parekh by Madhavpura is to be disbursed on a priority basis to its depositors and other co-operative banks.

The pay-orders issued by MMCBL to Ketan Parekh are parts of loans and advances and were not issued in favour of BoI. As a result, BoI cannot claim any recovery from MMCBL, the release stated.

MMCB does not owe any debt to BoI and, hence, it cannot claim any recovery from Madhavpura by demanding such attachments, the release added.